- FX update: At midday in London the AUD was the strongest while NZD and GBP were among the weakest:
- Thanks to the Brexit uncertainty, GBP was giving back more of its recent gains as investors awaited fresh developments. The Aussie was boosted by rallying metal prices (see below).
- Brexit update: UK PM Boris Johnson’ bid for an early election was effectively blocked on Thursday as Labour Party leader Jeremy Corbyn said he first wants to know the length of the Brexit extension granted by the EU before deciding whether to back the call. Well, today, the EU ambassadors have agreed in principle to delay Brexit. BUT they have not set a new date yet. According to Reuters, an EU official said: "Work will continue over the weekend. (27 EU ambassadors) are expected to meet early next week, on Monday or Tuesday, to finalise an agreement."
- US-China trade update: According to Reuters, top trade officials from the US and will discuss over the phone plans today “for China to buy more US farm products, but in return, Beijing will request cancellation of some planned and existing US tariffs on Chinese imports.”
- In commodities, prices of metals were showing further signs of strength with silver breaking out today. Precious metals prices have risen partly because of expectations than central banks globally will continue to keep monetary policy extraordinary loose, while base metals have found support amid optimism over a US-China trade deal. See “Metals galore: Gold, silver, copper, platinum and palladium all breaking higher” for more.
- Stocks were mixed in Asia and similarly in Europe with FTSE down and CAC higher. Investors awaited fresh developments from US-China and Brexit situations. The focus has been on earnings over the past couple of weeks with lots of US companies reporting this and next week. In Europe too, earnings have been coming in thick and fast:
- Amazon published its first profit drop in two years yesterday and the company’s shares were set to open around 6% lower. Yesterday’s other reporters included Tesla (TSLA, +18%), Paypal (PYPL, +9%), Intel (INTC, +6.0%), Microsoft (MSFT, +2%), Ford (F, -7%), eBay (EBAY, -9%), and Twitter (TWTR, -21%).
- Today’s Wall Street companies to report their results included Verizon Communications (VZ) which rose slightly on the back of positive results.
- In Europe, we heard from the likes of FTSE-100 listed Barclays (BARC, +1.1%) and WPP (7.3%) which reported better results. Meanwhile shares in Anheuser-Busch InBev (ABI, -9%) tanked as the world’s biggest brewer lowered its annual profit forecasts after a weak third quarter.
- There are no major economic data scheduled for release today, but next week will be very busy!
GAIN Capital UK Limited (trading as “City Index”) is an execution-only service provider. This material, whether or not it states any opinions, is for general information purposes only and it does not take into account your personal circumstances or objectives. This material has been prepared using the thoughts and opinions of the author and these may change. However, City Index does not plan to provide further updates to any material once published and it is not under any obligation to keep this material up to date. This material is short term in nature and may only relate to facts and circumstances existing at a specific time or day. Nothing in this material is (or should be considered to be) financial, investment, legal, tax or other advice and no reliance should be placed on it.
No opinion given in this material constitutes a recommendation by City Index or the author that any particular investment, security, transaction or investment strategy is suitable for any specific person. The material has not been prepared in accordance with legal requirements designed to promote the independence of investment research. Although City Index is not specifically prevented from dealing before providing this material, City Index does not seek to take advantage of the material prior to its dissemination. This material is not intended for distribution to, or use by, any person in any country or jurisdiction where such distribution or use would be contrary to local law or regulation.